China stocks rebound as investors shrug off MSCI "nay" decision

SHANGHAI, June 15 (Reuters) - China's stock market rose the
most in two weeks on Wednesday, reversing from early losses as
investors shrugged off MSCI's decision not to add mainland
shares to one of its key benchmark indexes.

Traders said investors had already been bracing for a "no"
decision, as reflected by Monday's market tumble of more than 3
percent, with some bargain hunting in the process.

They had opened roughly 1 percent lower as some investors
who had clung on to hopes of MSCI inclusion unwound their bets.

Index provider MSCI Inc said on Tuesday that Beijing had
more work to do in liberalising its capital markets before it
could add Chinese A shares to its emerging markets index, which
is tracked by $1.5 trillion of managed assets.

With the MSCI decision now in the rear mirror, investors are
focusing again on China's struggling economy and the potential
fallout for global growth and financial markets if Britain votes
to leave the European Union next week. Europe is one of China's
biggest export markets.

"Regarding MSCI, most retail investors in China don't really
care. And for institutions, their expectations of an inclusion
have been greatly reduced since the market crisis last year,"
said Charles Wang, Chairman of Shenzhen-based Appleridge Capital
Management Co.

"Failing to be included this time is not necessarily a bad
thing. It can prod the government to improve market mechanisms
and push reforms."

China's securities regulator said on Wednesday that MSCI's
decision won't affect the reform and opening process of the
country's capital markets, adding that any global benchmark
index that doesn't include A shares is "incomplete".
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